Kotak offers Highest Fixed Deposit (FD) Interest Rate in India

Kotak Mahindra Bank has recently launched a new fixed deposit (FD) offering an interest rate of 10.5% for duration ranging between 1 year 1 day and 2 years. I recently opened a fixed deposit with Kotak Mahindra Bank (Chennai – Anna Salai Branch). The customer service was great and I was done with the formalities in less than 30 minutes. A week later I was informed that my account was open, through SMS and Email. Kotak Mahindra Bank also sent me a greeting card on my birthday. Hats off to the customer care that Kotak Mahindra Bank provides. Coming back to the interest rates for fixed deposits (term deposits), Kotak Mahindra Bank and tamilnadu merchantile bank both top the “highest interest rate offered” table. However Kotak Mahindra Bank offers 10.5% annualised whereas Tamilnadu merchantile bank offers 10.5% non annualised.

20 thoughts on “Kotak offers Highest Fixed Deposit (FD) Interest Rate in India”

  1. @ limbuwala – To get tax benefits you will need to invest in the 5 year tax saving fixed deposit that Kotak offers. The interest rate is lower for the 5 year tax saving fixed deposit.

  2. @ elixir – No, Tax will be deducted at source at 10% if the total interest received per year, per bank, per branch is more than Rs. 10,000. The TDS interest limit has been revised in the previous budget from Rs. 5000 to Rs. 10000 and the effective date for the revision is June 01 2007.
    Even if TDS is not payable, you have to pay disclose the interest income under the head “other income” and pay taxes as usual.
    If your income is not taxable, then it is better to avoid paying TDS because it is difficult to get a refund once you pay the TDS. You can avoid paying TDS by opening multiple fixed deposit of Rs. 95000 each (at 10.5% interest) in different branches of Kotak Mahindra Bank.

  3. By the time the post of highest interest rate is published and readers try to plan something, Kotak bank has already reduced the interest rate and accordingly it is now 9.25 % for 1 year.

  4. @ Srinivas – Really? I opened a fixed deposit with Kotak Bank only last week. Its been less than a month since they brought in this scheme.

  5. Fortunately I had also opened an FD just 10 days back and was planning for another FD.
    Now i think karnataka bank may be giving the highest interest rate at 10% for 400 days which is also for a short duration.

  6. Though Kotak Bank offers high rates, but their Customer Swervice is Vey Bad. I went to bank for making FD, I have done all formalities and also C.S has put my check has High value Check and told me that it will cleared same and day and my FD will be made starting today.

    But after 2 days they called me that they FD cannot be made as Account needs to opened first and which will take 7 days. and they returned me my check and forms back

    I am Completly Disguted with thheir C.Service.

  7. sir i am from armed forces. i have monthly deductions of approx 12000/- in the defence services provident fund. so is it to better to keep the money in provident fund where i am getting interest rate of 8%. or should i go for fixed deposit in banks like kotak mahindra which r giving interest rate of 10.5% but with TDS. WHICH IS MORE PROFITABLE. also since fixed deposit rates r very volatile.so plz advice what should i do to have good income returns

  8. The customer service of kotak is alright, however the backoffice / processing department is extremely lethargic, and the sales guys are a total disgust.

  9. Dear Sir/Madam,

    I wish to take a FD. Please tell me where / whom i have to contact for getting the same. What all documents are required by me

    Thanks,

    James Abraham
    Bandra / Vasai
    Mob: 9324384375

  10. hi sir i am an nre working in some multinational last year i had done fd in my mothers name for 5lakh in punjab&sind bank my mother is senior citizen ,pls tell me will they charge us any tax later and also pls suggest me where should i invest the money in india for fd so no need to pay tax or i should save in foriegn as usd for 5% interest for 3 months only pls suggest

  11. Dear Sir/Madam,

    I wish to take a FD. Please tell me where / whom i have to contact for getting the same. What all documents are required by me

    Thanks,

    sarojini

  12. Tax will be deducted @ 10% of interest amount .Same can be get waived /rates reduced if your mother gets a certificate from the income tax office.
    Better to save in india as it will gain you higher interest rate of 9 percent which leaves you gainer even after paying 30 percent tax that is you will earn net 6.3 percent ( interest- tds)which is better.For more discussion contact us .

  13. there is no such thing as the highest interest rate. each bank claims to have the highest rates. all of them are actually right. they have various tenures to make their claims to sound true. so all the banks claim to offer the higest rate.a tenure differnce of 1 single day changes the rates accross banks.

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